China’s Putting its Foot Down: Bitcoin is Illegal

Crypto financial activities will be deemed illegal, including services from off-shore exchange accounts.
China is intensifying its crackdown on cryptocurrencies targeting exchange and mining activities.
Off-shore exchanges such as Huobi, OKEx, and a large Chinese customer base, incurred the steepest percentage decline.

China strikes time and time again. China’s influence on the crypto market is declining. Following a brief market recovery following Evergrande’s turmoil, the People’s Bank of China declared crypto activities illegal, including those from crypto exchanges outside mainland china.

Dismissing Crypto For The Greater Good

The cryptocurrency market dipped by at least 5% on September 24th after People’s Bank of China and other central authorities released a notice dating to September 15th, declaring Bitcoin, Ethereum, and even Tether do not hold the same status as FIAT currencies.

China has already implemented barriers, preventing banks from offering crypto-related services. Beijing’s take follows a series of allegations mainly stamping cryptocurrencies as “speculative,” or “leading to “criminal activities, or money laundering.As a result, China has banned mining and financial activities in the country, which previously caused Bitcoin’s price to retrace by more than 50%

China’s central bank PBOC seems to suggest that Bitcoin and crypto transactions are illegal. Below are Google-translated snapshot from their blog today. I believe this will push a lot of capital from China/Asia to re-invest in the West. Source: https://t.co/4BUVJMmN9g pic.twitter.com/y5XwxlaJOy
— Gabor Gurbacs (@gaborgurbacs) September 24, 2021

Presently, China’s statement also targets off-shore exchanges, which Chinese consumers previously used to conduct crypto transactions. As a result, Chinese customers can no longer interact and transact cryptocurrencies in mainland China, as exchanges will restrict access to. Chinese consumers.

Wu Blockchain notes the spiraling effect of China’s decisions. In a series of tweets, he notes that Spark Pool, Ethereum’s largest pool, will cease technical support for Chinese customers. Moreover, NBMINER, the graphics card manufacturer, also announced they would “no longer provide technical support” for Chinese customers.

On The Flipside

The crypto market no longer incurs significant losses after China clamps down on cryptocurrencies.

The Harsh Clampdown

In layman’s terms, China wants complete control over its financial payment system. So whilst dismissing cryptocurrencies such as Bitcoin and Etheruem, the People’s Republic of China has been developing and testing the e-Yuan as part of its strategy to challenge dollar domination.

China states crypto speculation and energy consumption are the leading cause of concerns that lead to harsher market restrictions. A notice dated September 3rd shows authorities will increase monitoring practices to identify mining operations.

In the follow-up to the Chinese policy, one of the most important indicators to observe is how huobi and OKEx, the two exchanges whose main users are Chinese, will react. How Binance will react is also worth watching.
— Wu Blockchain (@WuBlockchain) September 24, 2021

What’s interesting is how exchanges whose main customer base will react to the new regulations. OKEx or Huobi, whose main customer base is China, will need to act on the impose policy. OKEx price slid by more than. 15% following the new Chinese policy. However, Wu Blockchain notes that companies will be looking to relocate to Singapore due to its open crypto culture.

Why You Should Care?

Chinese crypto hegemony is decreasing, but we should be wary that no other country will have a more significant impact on the crypto market, including mining or trading.